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Invented high speed steel cutting tools andspent most of his life as a consulting
engineer Acknowledged as father of scientific
management Famous work entitled The Principles of
Scientific management published in 1911
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Replacing rules of thumb with science Obtaining harmony in group action
Achieving cooperation of human beings,rather than individualism
Working for maximum output Developing all workers to the fullest
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Father of modern management theory 14 Principles:
Authority and responsibility both arerelated
Unity of command receive orders from onesuperiors only
Scalar chain Chain of superiors fromhighest to the lowest ranks
Esprit de corps Union is strength
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Hawthrone studies Illumination was either increased or
decreased for a test group productivityimproved
But other factors were responsible for it Factors such as morale, satisfactory
interrelationships between the members of awork group
Phenomenon - Hawthrone effect
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Peter F Drucker - written generalmanagement topics
Keith Davis informal organisation W. Edward Demings and Joseph M Juran -
Quality of Japanese products Laurence Peter People get promoted to a
level where they are incompetent and nofurther promotion is possible
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William Ouchi best selling book Theory Z Thomas Peters and Robert waterman
characteristics of excellent companies
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1. Empirical Approach Studies experience through cases
Identifies successes and failures
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Managerial practice depends oncircumstances
Cause and effect depends on contingency i.esituation
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Management is seen as mathematicalprocesses Concepts, symbols and models
Logical process expressed in symbols
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Focus on the making of decisions, persons orgroup making decisions
Entire area of business activity, nature oforganisation structure, information decision,group decision making, value of decisionmakers, individual decision making andprocess of decision making
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Fundamental rethinking process analysis,radical redesign, dramatic results
Operations: Input transformation Output
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Broad applicability Systems have boundaries but they also
interact with external environment Interrelatedness of planning, organising, and
controlling in an organisation as well assubsystems
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Technical system has great effect on socialsystem
Focus on production, office operations andother areas with close relationships
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Concerned with both interpersonal and groupbehavioural aspects leading to a system of
cooperation
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Emphasis on behaviour of people in groups Study of group behviour patterns
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Focus on interpersonal behaviour, humanrelations, leadership and motivation
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The seven SS are: Strategy
Structure Systems Style Staff Shared values Skills
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Dependable satisfying products and services Attention to teamwork
Quality education Customer needs
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Draw knowledge from approaches above Integrates the approaches with science and
theory
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Planning involves selecting missions andobjectives and the actions to achieve them; it
requires decision making which is, choosingfrom the alternatives available the futurecourses of action
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Plans provide a rational approach to achievethe preselected objectives
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Its contribution to purpose and objectives Its primacy among the managers tasks
Its pervasiveness The efficiency of resulting plans
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1. Purposes or missions Identifies the basic function or task of an
enterprise Meaningful purpose Ex: Business Production and distribution of
goods and services University Teaching and research
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Mission Social purpose of producing anddistributing goods and services
Ex: Hall mark The social expressionbusiness
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Ends toward which activity is aimed Goals contribute to the attainment of
enterprise objective Ex: Objective to make profit by producing a
home entertainment equipment Goals Produce required number of
television design, quality, cost
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Determination of the long term objectives ofan enterprise
Adoption of courses of action Allocation of necessary resources Ex: Decide what kind of business Is it transportation or a paper manufacturer Purpose of strategies furnish a framework
for guiding, thinking and action
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General statement/guide or channel thinkingin decision making
Define an area within which decision is to bemade Helps to decide issues before they become
problems
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Exist on all levels of organisation Range from major to minor policies
Ex: University trained engineers Setting competitive prices Making policies consistent is difficult due to: a. seldom defined in writing b. Exact interpretation are too little c. Not easy to control policy
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Are plans that establish a required method ofhandling future activities
Guides to action Ex: Procedure for handling orders involve
sales department, finance, accounting,production department
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POLICY
To grant employeesvacations
PROCEDURES
To implement policy-provide for schedulingvacations to avoiddisruption of work
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Specific required actions or non actions,allowing no discretion
Procedure may be looked upon as a sequenceof rules Rule may not be a part of procedure Ex: No smoking rule Handling of orders - Procedure Rule allows no deviation
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Are a complex of goals, policies, procedurestask assignments, steps to be taken and
other elements necessary to carry out a givencourse of action Ex: 5 year program to improve quality
standard Morale of workers in manufacturing
department
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Ex: Investing in new jets involve million ofdollars for purchase of aircraft, spare parts
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Is a statement of expected results expressedin numerical terms
Expressed in financial terms in labour hours,units of product, machine hours Capital expenditure, cash flow To make in advance for a week or 5 years Necessary for control
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Types: Variable/flexible budget according to level
of output Program budgets Agency develops detailed
programs Zero base budget Combination of both As programs started from Base Zero
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Being aware ofopportunity
Setting objectives orgoals
Considering planning
premises
Identifyingalternatives
Comparing alternatives
Choosing an alternative
Formulating supportingplans
Numberizing plans bymaking budgets
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1. Being aware of opportunities Aware of opportunities within the
organisation and external environment Preliminary look at future opportunities Know strength and weakness What problems to solve, why? what to gain Setting objectives depends on awareness
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Objectives for entire enterprise For each subordinate work unit
For long term/short term Specify end results what is to be done Give direction to the major plans Objectives form a hierarchy Managers should contribute their ideas
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Assumptions about the environment in whichthe plan is to be carried out
Forecasting in premising Kinds of markets? Volume of sales, prices, products, costs, wage
rates, tax rate, technical development,
dividend, expansion
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Examine alternative courses of action Reduce the number of alternatives analyse
Mathematical techniques and computer used Discover fruitful possibilities
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Examine strong and weak points Some suit the companys long range
objectives So many variables and limitations to be
considered Evaluation is difficult with simple problems
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Real point of decision making Decide to follow several courses rather than
one best course
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Required to support the basic plan
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Numberize the plans and convert them intobudgets
Represent the sum total of income andexpenses Each department have its own budgets
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Set important standards against whichplanning progress can be measured
Ex: Apply the planning steps in preparing forcollege
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Objectives were defined as the importantends toward which organisational and
individual activities are directed Verifiable objectives At the end of the
period it should be possible to determinewhether or not the objective has been
achieved
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Objectives form a hierarchy as well asnetwork
Multiple goals that are sometimesincompatible and may lead to conflictswithin the organisation, within the group andeven within individuals
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1. Purpose of the society 2. Mission of the business
3. Overall objectives 4. More specific objectives (KRA key Result
areas) 5. Division objectives 6.Department and unit objectives 7.Individual objectives
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Objectives must be verifiable Verifiable to achieve a return on investment
of 12% at the end of the current year Non verifiable to make a reasonable profit Quantitative/qualitative objectives Not be too long Present a challenge, indicate priorities,
promote personal and professional growthand development
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Refer to determination of purpose Allocation of resources
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Strategies and policies are closely related,framework for plans, basis of operational
plans, affect all areas of managing
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1. Inputs goal inputs 2. Enterprise profile determine where the
company is?, Where is should go? 3. Orientation of Top managers Enterprise profile shaped by people Give orientation Examine their values, preferences, attitudes
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4. purpose and major objectives End pointsactivities directed
5. external environment Present and futureenvironment assessed Environment scanned economic, social,
political, legal, geographic factors
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6. Internal environment SWOT Analysis Audit resources, production, marketing,
procurement, human and financial resources 7. Development of alternative strategies Specialise or concentrate Ex: Korean Hyundai company produced
lower priced cars, diversify and extendoperation
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8. Evaluation and choice of strategies Consider risks involved, timing, reaction of
competitors Ex: IBM reduced the price of PCs in reaction
to apples computer
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9. medium and short range planning,implementation and control
Implementation of the plan during allphases of the process,
control monitor the performance Feedback
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10. Consistency and contingency Testing for consistency, preparing for
contingency plans, key aspect of strategicplanning
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